TAXATION - REAL PROPERTY ASSESSMENT

Authors

Wayne E. Bahler, University of Michigan Law School

Abstract

Based upon the cost-depreciation method applicable to adjacent property, the assessment of the Detroit-Windsor tunnel and terminal resulted in taxes equal to forty-one per cent of the gross revenue for the depression years of 1931-1934; The federal district court enjoined the collection of such amount, and assessed the property by the capitalized income method (seven per cent) plus $3,500 for the value of possible future increased earnings. Upon appeal it was held that the injunction on the original levy be affirmed since the cost-depreciation method was erroneous and offensive to the Fourteenth Amendment in not taking account of depressions or the fact that property might be used for other purposes; that the business was in fact a public utility and the capitalized income method of assessment gives a fair value; that the court erred in actually assessing the property and enjoining the collection of any greater amounts; and that the taxing authorities be free to assess the property again for the years involved. City of Detroit v. Detroit & Canada Tunnel Co., (C. C. A. 6th, 1937) 92 F. (2d) 833.

Recommended Citation

Wayne E. Bahler, TAXATION - REAL PROPERTY ASSESSMENT, 36 Mich. L. Rev. 1036 (1938).
Available at: https://repository.law.umich.edu/mlr/vol36/iss6/25